If Only I’d Known: Angry Birds and Information SharingNitin Sumangali |
What does it cost to make the Internet run, and who will pay that cost?
Advertising has been critical in the expansion and development of online commerce, and online businesses that rely on it evidently believe targeted advertising based on more knowledge of consumers gives more bang for the marketing buck. According to a recent New York Times article, games such as Angry Birds are collecting personal information about users in order to learn more about them and create more targeted advertising. This information can cover a broad spectrum; it may be location data or a unique identifying number for the phone, but may also be scanning users’ contact lists or photos.
The Angry Birds collection of games was launched in December 2009, and in May of this year surpassed one billion downloads. The Finland based company Rovio that created the game has been profiting from a variety of revenue streams the game created: there are paid downloads, merchandizing opportunities, and advertising revenue. The practicalities of how consumer games are monetized by advertising are starting to draw the attention of new parties.
The New York Times article notes a study conducted by the Human-Computer Interaction Institute at Carnegie Mellon University which surveyed 40 users to find out how many knew that Angry Birds was storing their location data. Only two were aware. Jason Hong, an associate professor at the Institute at Carnegie Mellon University is quoted as saying, “When I am giving a talk about this, some people will pull out their smartphones while I am still speaking and erase the game. Generally, most people are simply unaware of what is going on.”
This type of reaction matches what the Global Insights team has seen in other initiatives that use consumer data to improve advertising efforts: if consumers don’t feel sufficiently informed about what data is being collected and used to develop profiles on them, they will react negatively. Consumers may decide that such a trade-off is worthwhile, but they must be made to feel they’ve learned enough about what data is gathered and how to make that decision with their eyes open.
The Times article also notes that there are proposals in the European Union that would give consumers the choice to opt out of certain data collections, while retaining the ability to use the service. Efforts on the part of regulators will force consumers to make this choice more actively. The case for this type of targeted advertising must be made clearly and honestly if it is to sustain itself: games like Angry Birds and other Internet services collect data from users for advertising purposes, and these advertisements are what make Internet services available to users for free. If consumers know a fuller story of how the services they use are paid for, only then can they make a decision to accept, reject, or reform the system.
Topics: Payments Strategy